Despite increased confidence in savings among most Americans, a new BlackRock survey reveals that the average worker is more concerned than ever about whether their savings will last throughout their lifetime.
Recent Retirement Survey
A new survey shows that Americans are feeling more confident about their retirement savings compared to last year. But what it also shows is one major underlying concern – that those savings won’t last.
Read on Retirement
BlackRock, the world’s largest asset management service, has released its ninth annual Read on Retirement™ survey, which explores how Americans across multiple generations feel about their retirement prospects.
One Step Forward, One Step Back
This year, 68% of Americans with workplace retirement plans are feeling more on track with their retirement savings compared to just 56% last year. It’s a positive leap forward but doesn’t account for the growing fear of outliving retirement savings.
Fear of Outliving Savings
More than 60% of survey participants this year reported feeling worry and concern that they will live longer than their savings can sustain them.
Well-Established Fear
These fears aren’t new. The latest Read on Retirement survey is the third annual survey in a row that shows a majority of respondents sharing concerns about outliving their nest egg.
Across Generations
It also isn’t relegated to only older or younger generations. Instead, it is shared across the board, as the survey involves participants who are part of Gen Z, Millennials, Gen X, and Baby Boomers.
Only Minor Differences
Savers across the generations feel the fear, with a whopping 69% of Gen Z respondents saying they worry their savings will run out, and 56% of Millennials and 63% of Gen X saying the same thing.
A Common Thread
Confusion around savings and long-term financial planning was also a common thread across generational and gender divides. Many people reported feeling confused about how much of their income they will need to save to sustain them through retirement.
Confusion Over Savings Planning
“Multiple groups of respondents across generation and gender cohorts reported confusion about how much to save, worries about outliving savings, and uncertainty in how much income they will need in retirement,” the survey elaborated.
Employers Also Concerned
It isn’t only workers who feel these fears. Employers who sponsor their employee’s retirement plans and participated in the survey reported feeling concerns over their employee’s retirement preparedness.
Falling Confidence
Last year 64% of plan sponsors reportedly felt confident that their employees were successfully working toward retirement savings goals. This year, that number fell to 58%.
A Major Issue Today
What’s more, 72% of employers now believe that outliving retirement savings has become an even more important issue due to current economic issues. A stark 99% of employers feel that it is their responsibility to help employees achieve this.
The Gender Gap
While these concerns are consistently rising across age and gender groups, the survey did show women are notably less confident about their retirement savings compared to men.
Women Less Confident
In fact, it was the biggest gap noted between different demographics that participated in the survey. Only 59% of women reported feeling confident about their retirement savings, compared to 75% of men.
Men 30% More Confident
By extrapolating the data, nearly 30% of men are more confident about financially sustaining their retirement. 65% of women worry they will outlive their nest egg compared to 57% of men.
A Complicated Matter
BlackRock representatives believe the biggest takeaway from the survey was displaying how “complicated” the subject of retirement is for most Americans, regardless of their age or background.
Personal Journey, Shared Challenges
“The journey to retirement is personal, but the challenges are shared,” said BlackRock Senior Advisor on Retirement Anne Ackerley. “Our research continues to underscore how complicated the path is for Americans when planning for retirement.”
Time to Rethink Retirement?
“This is an important moment to rethink retirement,” she continued. “And we are committed to convening conversations around ways we can make retirement investing simpler, more accessible, and more affordable for as many people as possible.”
More Resources Needed
Rob Crothers, Head of U.S. Retirement at the management and consulting company Global Product Solutions believes that providing better resources and education around retirement saving and other financial issues is key in reducing the complexities and difficulties reflected in the survey.
Resources, Tools, and Strategies
“While there is no one, single retirement solution that works for all, we believe providing financial resources, strategies, and tools for all Americans is a critical first step in reducing complexity for those who are clearly struggling to understand their path to retirement,” he said.
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